JioPhone pre-bookings hit 6 million

An executive close to Jio said the company has the capacity to deliver about 150 million phones in the next six months at five million a week.Devina Sengupta | ET Bureau | Updated: September 02, 2017, 10:35 IST

Reliance Retail received six million pre-bookings for its 4G feature phone in a short window of just over a day, indicating strong demand for a device which is set for a Navratri delivery and is expected to further dent the market shares of India's top telcos.

The pre-order window opened on August 24 evening and closed early August 26. Apart from those who managed to pre-book the JioPhone, about 10 million have registered with retail outlets, showing an interest in placing an order, said people close to Reliance Retail.

Meanwhile, the top telcos may have opened another battle front, saying new entrant Reliance Jio may be flouting the concept of net neutrality by providing SIM-locked handsets which offer limited apps under a tariff plan and are as good as a ‘walled garden’.

However, people said the device gives unrestricted access to internet and therefore the question of net neutrality does not arise.

JioPhone – through which Jio is targeting a bulk of the roughly 500 million feature phone users who haven’t yet upgraded to a smartphone— is expected to be the next big disruptor in the telecom industry, which for the last four quarters has been engulfed in a brutal tariff war that has hurt revenue and profits. An executive close to Jio said the company has the capacity to deliver about 150 million phones in the next six months at five million a week.

Reliance Industries (RIL) –which started its telecom operations through Jio around a year ago — had suspended the booking window from Saturday till further notice after demand for the device far exceeded the target of making available five million phones a week.

Bookings for JioPhone can be done with a Rs 500 advance, with the remaining Rs 1,000 to be paid on receipt of device. The deposit of Rs 1,500 is refundable after three years on return of the device. People in the know said the idea is to not keep those having booked waiting for too long. “We need to have a good assessment of where the demand is going to be, and accordingly prepare ourselves.

When estimating demand on when how many devices will be required, one may be off by 5%, but not 30-40%,” the person cited earlier said. The mass-market phone being offered effectively free is key to Jio's bid to quickly scale up its nearly 130 million user base. The phone will be distributed on a first-come-first-served basis through Jio retailers, multi-brand device retailers and network of Reliance Digital stores. Jio, however, is bracing for competition from other feature phone makers, which they expect will further expand the market.

The country’s largest telecom operator, Bharti Airtel, is in advanced talks with handset makers to introduce a 4G smartphone in the lead up to Diwali for about Rs 2,500, bundling large amounts of data and voice minutes. “If you are developing a Rs 2,500 smartphone, you are compromising on a lot of things like the screen quality and battery life. Feature phones are sturdier,” the person cited earlier said.

Vodafone has tied up with feature phone maker iTel for free talk on devices priced above Rs 800. Brokerage firm CLSA said in a recent it expects more tie-ups between operators and device vendors. “We view these offers as limited retaliation and delayed, given that people who have paid Rs 500 to prebook Jio phones are unlikely to switch to incumbents,” it said.